Tax liability
This query is : Open
CHIRAG JOSHI
(Querist)
27 November 2016
dear all,
if partnership firm taken loan rs.5cr from financial institute for construction of factory premises and the same amount give to loan in Pvt Ltd company as a loan. also factory premises given on rent to Pvt Ltd company
1-EMI paid by partnership firm rs.9 lacs.
2- partnership firm received rent from Pvt Ltd co rs.9 lacs (4lacs rent and 5 lacs as a interest)
is tax liability by partnership firm
CA. Vinodh Kothari
(Expert)
28 November 2016
EMI part includes both interest and principal portion only interest portion can be claimed as expenditure. So 9 lakhs after adjustment of interest will be taxable.
Loan taken for construction should be utilized for that purpose.
VK
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